ROSSCO,STI4

I have water leaking from my turbo area, the water ends up on the exhaust manifold and then burns off. I have checked the banjo bolts etc. I even pressure tested the turbo when it is not in operation. It was fine. My question is , does the water cooling actually come in contact with the turbo moving parts, or does it just cool the metal block which in turn keeps the turbo cooler ?

Thanks